UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF VIRGINIA

FEDERAL TRADE COMMISSION, Plaintiff

v.

MODEL 1, INC., et al., Defendants.

Civil No. 99-737 A

FINAL CONSENT ORDER

The Federal Trade Commission ("Commission") commenced this civil enforcement action on May 25, 1999 pursuant to Section 13(b) of the Federal Trade Commission Act ("FTC Act"), 15 U.S.C. § 53(b), seeking both permanent injunctive relief and consumer redress for alleged unfair or deceptive acts or practices by defendants in violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), in connection with the advertising, promotion, offering for sale and sale of talent management services for aspiring models or actors. The defendants, named in the Complaint for Permanent Injunction and Other Equitable Relief ("Complaint"), are Model 1, Inc., Creative Talent Management, Inc., Jason Hoffman and Ralph E. Bell. The Commission and defendants hereby stipulate to this Final Consent Order.

FINDINGS

NOW, THEREFORE, on joint motion of the parties, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED as follows:

1. This is an action by the Commission under Section 13(b) of the FTC Act, 15 U.S.C. § 53(b). Pursuant to this section, the Commission has the authority to seek the requested relief.

2. This Court has jurisdiction over the subject matter of this action and all the parties. Venue in the Eastern District of Virginia is proper.

3. The Complaint states a claim upon which relief may be granted against the defendants under Sections 5(a) and 13(b) of the FTC Act, 15 U.S.C. §§ 45(a) and 53(b).

4. The activities of the defendants, as alleged in the Complaint, are in or affecting commerce, as defined in Section 4 of the FTC Act, 15 U.S.C. § 44.

5. The defendants, without admitting the allegations set forth in the Complaint, stipulate and agree to this Order, without trial or final adjudication of any issue of fact or law, to settle and resolve all matters in dispute arising from the Complaint to the date of entry of this Order. The Commission and defendants stipulate and agree that this Order constitutes a settlement agreement pursuant to Federal Rule of Evidence 408.

6. Defendants have waived all claims under Equal Access to Justice Act, 28 U.S.C. § 2412, and all rights to seek judicial review, or otherwise to challenge validity of this Order.

7. Entry of this Order is in the public interest.

8. Pursuant to Federal Rule of Civil Procedure 65(d), the provisions of this Order are binding upon defendants and their officers, agents, servants, employees and attorneys, and upon those persons or entities in active concert or participation with them who receive actual notice of this Order by personal service or otherwise.

DEFINITIONS

For purposes of this Order, the following definitions shall apply:

A. "Talent management services" ("TMS") shall mean the offer and sale of modeling and acting training classes, separately or in combination with other services for aspiring actors and models, including, but not limited to, referrals for representation, job placement and photographic services.

B. "Assisting others" shall mean providing any of the following services to any person or entity in connection with the offer or sale of TMS: (1) performing marketing services to consumers; (2) acting as an officer or director of a TMS business; (3) reviewing the marketability of individuals for professional work as an actor or model on behalf of an entity that offers TMS; (4) allowing a TMS business to use any client's name unless that client hired graduates of that TMS program during the preceding three (3) calendar years; or (5) serving as a reference for a TMS entity.

C. "Corporate defendants" shall refer to Model 1, Inc. ("Model 1"), and Creative Talent Management, Inc., formerly known as Erickson Talent Management, Inc. and Creative Artists, Inc. (collectively "CTM").

D. "Individual defendants" shall refer to Jason Hoffman and Ralph Edward Bell.

E. "Document" is synonymous in meaning and equal in scope to the usage of the term in the Federal Rule of Civil Procedure 34(a) and includes writings, drawings, graphs, charts, photographs, audio and video recordings, computer records, and other data compilations from which information can be obtained and translated, if necessary, through detection devices into reasonably usable form. A draft or non-identical copy is a separate document within the meaning of the term.

F. "Collection efforts" shall include: communicating with the debtor, communicating with third parties about the debtor, commencing legal action against a debtor, and reporting any negative information to a credit reporting bureau.

G. A requirement that any defendant "notify" or "provide" any information or material to the Commission shall mean that the defendant shall send the necessary information or material via first-class mail, costs prepaid, to:

Associate Director, Division of Enforcement
Federal Trade Commission
Room 4302-S
600 Pennsylvania Avenue, N.W.
Washington, DC 20580

Re: FTC v. Model 1, Inc., et al.

ORDER

I. PROHIBITED BUSINESS ACTIVITIES

A. IT IS THEREFORE ORDERED that defendants are permanently restrained and enjoined from engaging, participating, or assisting in any manner in the advertising, marketing, promotion, or offering of screen tests, casting calls or auditions when such screen tests, casting calls or auditions are being offered by defendants, their employees or persons directly or indirectly under their control, and when such activities are being offered in conjunction with the advertising, marketing, promotion, offering for sale of any product or service; provided that nothing in this paragraph shall prohibit any defendant who is employed as a booking agent, from holding screen tests, casting calls, or auditions to cast projects;

B. Defendants and their officers, directors, agents, servants, employees, salespersons, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and other entities or persons directly or indirectly under their control, and all persons or entities in active concert or participation with them who receive actual notice of this Order by personal service, facsimile or otherwise, are hereby permanently restrained and enjoined from making or assisting others to make, expressly or by implication, any false or misleading oral or written representation, in connection with the offer or sale of any goods or services for aspiring or professional models and actors, including, but not limited to:

1. That they are selective in scouting, screening, and reviewing consumers for marketability as models or actors;

2. That consumers are likely to obtain substantial paid employment as models or actors through defendants' efforts;

3. That their principal source of income is commissions on the fees paid to their models and actors by clients;

4. That individual talent scouts, Vice Presidents, sales personnel or other agents have industry expertise to assess consumers' marketability as models or actors;

5. That any person or entity has hired talent trained by defendants;

6. The availability of specific modeling or acting assignments; or,

7. That a screen test or audition is likely to lead to acting or modeling employment.

C. In connection with the offer or sale of TMS, defendants shall furnish a legible completed copy of the Notice set forth in Appendix A during each initial face-to-face contact with a consumer. The Notice shall be clearly and conspicuously printed in at least 12-point type on a separate document that contains no other information. When a consumer contacts defendants in person in response to a radio, televison, print or Internet advertisement, defendants shall furnish a legible completed copy of the Notice set forth in Appendix A at the outset of the initial interview or conversation with a consumer about defendants' services. Defendants shall obtain from each consumer a signed acknowledgment of receipt of the Notice prior to accepting any payment or contract for defendants' services. Defendants shall retain and maintain copies of the signed acknowledgments for three (3) years from the date of entry of this Order.

II. BOND REQUIREMENTS

IT IS FURTHER ORDERED that defendants are permanently restrained and enjoined from engaging, participating, or assisting others in any manner or capacity whatsoever, whether directly, or indirectly, or through any business entity or other device, in the advertising, marketing, promotion, offering for sale, or sale, of TMS ("Bond Covered Activity"), unless prior to engaging in such activities defendants obtain a surety bond in the principal sum of $500,000.00. Provided, however, that if defendants have ceased the advertising, marketing, promotion, offering for sale, or sale of TMS, defendants shall not be required to post a bond in order to complete training classes pursuant to contracts entered into before the date of this Order, unless defendants resume the advertising, marketing, promotion, offering for sale, or sale of TMS.

A. The bond required by this Section shall be conditioned upon defendants' compliance with Section 5(a) of the FTC Act, 15 U.S.C. § 45(a) and with the provisions of this Order. The bond shall be continuous and remain in full force and effect as long as the bonded defendants continue to engage in the Bond Covered Activity, and for at least five (5) years after defendants have ceased to engage in Bond Covered Activities. The bond shall cite this Order as the subject matter of the bond, and shall provide surety thereunder to consumers against financial loss resulting from any violation of Section 5(a) of the FTC Act, 15 U.S.C. § 45(a) or the provisions of this Order.

B. The surety bond required by this Section will be secured for financial loss issued by a surety company that:

1. is admitted to do business in each of the states in which defendants conduct business;

2. holds a Federal Certificate of Authority As Acceptable Surety On Federal Bond and Reinsuring; and,

3. the bond shall be in favor of both (1) the Commission for the benefit of any consumer injured as a result of any false or misleading representation made by defendants, their agents, or any other persons acting in concert with them or under their authority, supervision or control, while engaging in the Bond Covered Activity; and (2) for the benefit of any consumer so injured.

C. The bond required pursuant to this Section is in addition to, and not in lieu of, any other bond required by federal, state, or local law. This bond requirement shall not be construed to limit or preempt the regulatory powers of any other federal, state, regional, county, local or other government agency or authority.

D. At least ten (10) days before commencing the Bond Covered Activity, defendants shall provide the original of the bond required by this Section to the Commission.

E. Defendants, directly or through their officers, directors, agents, servants, employees, salespersons, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and other entities or persons directly or indirectly under their control, and all persons or entities in active concert or participation with them shall not disclose the existence of the surety bond to any consumer or prospective customer without also disclosing clearly and conspicuously, at the same time:

THE BOND IS REQUIRED BY ORDER OF THE U.S. DISTRICT COURT IN SETTLEMENT OF CHARGES THAT JASON HOFFMAN, RALPH BELL, MODEL 1, INC., AND CREATIVE TALENT MANAGEMENT, INC. ENGAGED IN MISREPRESENTATIONS IN CONNECTION WITH THE ADVERTISING, PROMOTION, OFFERING FOR SALE AND SALE OF TALENT MANAGEMENT SERVICES.

III. MONETARY RELIEF

IT IS FURTHER ORDERED that:

A. Defendant Ralph Bell shall pay to the Federal Trade Commission, in full satisfaction of all monetary claims asserted by the Commission in its complaint, either (1) the sum of $50,000, no later than sixty (60) days from the date of entry of this Order; or (2) the sum of $70,000 (Bell Settlement Amount) as follows:

1. Defendant Ralph Bell shall pay the sum of $38,000, no later than five (5) business days after entry of this Order; and

2. Defendant Ralph Bell shall pay the balance of the Bell Settlement Amount, $32,000, in eight (8) equal quarterly installments of one/eighth (1/8th) of the balance due and owing as of the first day of the third month following entry of this Order, the first installment of which shall be payable no later than the first day of the third month following entry of this Order and subsequent installments shall be due on the first day of every third month thereafter; and,

3. Defendant Ralph Bell shall secure the Bell Settlement Amount by delivery to the FTC of a Mortgage in favor of the FTC in a form acceptable to counsel for the FTC for real estate located at 6544 Hitt Avenue, McLean, Virginia, 22101 (Hitt Avenue Property). The FTC shall hold a second mortgage on the Hitt Avenue Property and shall be subordinate only to the first mortgage and such other liens as shall have priority under applicable law. The Hitt Avenue property shall be pledged to secure full payment of the amount due under the Bell Settlement Amount. Within ten (10) days of the payment of the full amount required by this Paragraph, all liens and mortgages in favor of the FTC shall be canceled by the FTC.

B. Defendant Jason Hoffman shall pay to the Federal Trade Commission, in full satisfaction of all monetary claims asserted by the Commission in its complaint, the sum of $10,000 (Hoffman Settlement Amount) as follows:

1. Defendant Jason Hoffman shall pay the sum of $2,000, no later than sixty (60) days from the date of entry of this Order;

2. Defendant Jason Hoffman shall pay the balance of the Hoffman Settlement Amount, $8,000, in eight (8) equal quarterly installments of one/eighth (1/8th) of the balance due and owing as of the first day of the third month following entry of this Order, the first installment of which shall be payable no later than the first day of the third month following entry of this Order and subsequent installments shall be due on the first day of every third month thereafter.

C. The payments required pursuant to Paragraphs A and B of this Section are for equitable monetary relief, including but not limited to, consumer redress and/or disgorgement and for paying any attendant expenses of administering any redress fund. If the Commission determines, in its sole discretion, that redress is wholly or partially impracticable, any funds not used for redress shall be deposited into the United States Treasury as disgorgement. The Commission in its sole discretion may use a designated agent to administer consumer redress.

D. Defendants CTM and Model 1, shall immediately, upon entry of the Order, permanently cease collection efforts on all accounts receivables of consumers who have not attended any training courses (Non-Attendees). If any Non-Attendee subsequently attends Model 1's training courses, defendants may resume collection efforts as to that consumer. Defendants may send a Notification letter as set forth in Appendix C to consumers advising them that Model 1 will not offer classes after January 2000, and that if consumers want to pursue training they must contact Model 1 to schedule classes. Such Notification letter will state that consumers who never previously attended any training course offered by Model 1 and are not interested in pursuing training will be relieved of further obligation to pay on their contracts. Defendants shall provide the names, addresses, phone numbers and both the contract amount and outstanding balance for each consumer against whom defendants are continuing collection efforts pursuant to this Paragraph no later than January 31, 2000. Defendants CTM and Model 1 shall not sell or transfer these accounts receivable to any person or entity.

IV. RECORD KEEPING PROVISIONS

IT IS FURTHER ORDERED that, for a period of five (5) years from the date of entry of this Order, defendants, and their officers, directors, agents, servants, employees, salespersons, attorneys, corporations, subsidiaries, affiliates, successors, assigns, and other entities or persons directly or indirectly under their control, and all persons or entities in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, in connection with any business where (1) individually or jointly, defendants are officers, directors, managers or majority owners or directly or indirectly control or manage the business, and (2) the business engages in the advertising, promotion, offering for sale, or sale of TMS are hereby restrained and enjoined from failing to have such business create, and from failing to have such business retain for a period of three (3) years following the date of such creation, unless otherwise specified:

A. Books, records and accounts that, in reasonable detail, accurately and fairly reflect the cost of goods or services sold, revenues generated, and the disbursement of such revenues;

B. Records accurately reflecting: the name, address, and telephone number of each person employed in any capacity by such business, including as an independent contractor; that person's job title or position; the date upon which the person commenced work; and the date upon which the person ceased work; provided that the business subject to this subsection shall retain such records for a period of two (2) years following the date of each such person's termination;

C. Records containing the names, addresses, phone numbers, dollar amounts paid, services purchased, for all consumers to whom such business has sold any goods or services, or from whom any of the above-referenced businesses accepted money or other items of value;

D. Records that reflect, for every written consumer complaint or refund request, whether received directly or indirectly: (1) the consumer's name, address, telephone number and the dollar amount paid by the consumer; (2) the written complaint or refund request, if any, and the date of the complaint or refund request; (3) the basis of the complaint, including the name of any salesperson complained against, and the nature and result of any investigation conducted concerning any complaint; (4) each response and the date of the response; (5) any final resolution and the date of the resolution; and (6) in the event of a denial of a refund request, the reason for the denial; and,

E. Copies of all sales scripts, training materials, advertisements, or other marketing materials utilized; provided that copies of all sales scripts, training materials, scouting training materials, advertisements, or other marketing materials utilized shall be retained for three (3) years after the last date of dissemination of any such materials.

Provided, however, that if defendants have ceased the advertising, marketing, promotion, offering for sale, or sale of TMS, defendants shall not be required to maintain the records enumerated in this provision in order to complete training classes pursuant to contracts entered into before the date of this Order, unless defendants resume the advertising, marketing, promotion, offering for sale, or sale of TMS.

V. NON-DISCLOSURE OF CONSUMER LISTS

IT IS FURTHER ORDERED that defendants, and their officers, agents, servants, employees, and attorneys, and all other persons or entities in active concert or participation with them who receive actual notice of this Order by personal service or otherwise, are permanently restrained and enjoined from selling, renting, leasing, transferring, or otherwise disclosing the name, address, telephone number, credit card number, bank account number, e-mail address, or other identifying information of any person solicited by or on behalf of any defendant at any time prior to entry of this Order, in connection with TMS. Provided, however, that defendants may disclose such identifying information to a law enforcement agency or as required by any law, regulation, or court order. Further, nothing herein shall prevent defendants from referring consumers to prospective employers or talent agencies.

VI. COMPLIANCE REPORTING BY DEFENDANTS

IT IS FURTHER ORDERED that:

A. For a period of five (5) years from the date of entry of this Order, individual defendants shall notify the Commission of the following: (1) any changes in their business addresses, residential addresses or telephone numbers, within ten (10) days of the date of such change; and (2) any changes in their employment status (including self-employment) within ten (10) days of such change. Such notice shall include the name and address of each business that individual defendants are employed by, a statement of the nature of the businesses, and a statement of their duties and responsibilities in connection with the businesses or employments;

B. For a period of five (5) years from the date of entry of this Order, corporate defendants shall notify the Commission of any proposed change in the structure of the corporate defendants or any proposed change in the structure of any business entity owned or controlled by any individual defendant, such as creation, incorporation, dissolution, assignment, sale, merger, dissolution of subsidiaries, proposed filing of a bankruptcy petition, or change in the corporate name or address, or any other change that may affect compliance obligations arising out of this Order, thirty (30) days prior to the effective date of any proposed change; provided, however, that with respect to any proposed change in the corporation about which a defendant learns less than thirty (30) days prior to the date such action is to take place, such defendant shall notify the Commission as soon as is practicable after learning of such proposed change;

C. One hundred and eighty (180) days after the date of entry of this Order, each defendant shall submit a written report to the Commission, signed under penalty of perjury, setting forth in detail the manner and form in which the defendant has complied and is complying with this Order. These reports shall include but not be limited to:

1. Defendant's then current residence address and telephone number;

2. Defendant's then current employment, business addresses and telephone numbers, a description of the business activities of each such employer, and defendant's title and responsibilities for each employer;

3. A copy of each acknowledgment of receipt of this Order obtained by defendants pursuant to Section XI of this Order; and

4. A statement describing the manner in which defendants have complied and are complying with the provisions of Sections I and II of this Order, including copies of any written verifications obtained by defendants pursuant to Section I(C) of this Order. D. Upon written request by a representative of the Commission, defendants shall submit written reports (under oath, if requested) and produce documents on fifteen (15) business days' notice with respect to any conduct subject to this Order;

E. For the purposes of this section, "employment" includes the performance of services as an employee, consultant, independent contractor, or officer or director; and "employer" includes any individual or entity for whom individual defendants perform services as an employee, consultant or independent contractor;

F. For purposes of the compliance reporting required by this section, the Commission will communicate directly with counsel of record unless otherwise requested by defendants.

VII. RIGHT TO REOPEN

IT IS FURTHER ORDERED THAT the Commission's agreement to this Order is expressly premised upon the truthfulness, accuracy, and completeness of defendants' financial condition as represented in their sworn financial statements titled "Federal Trade Commission Financial Statement of Corporate Defendant" and "Federal Trade Commission Financial Statement of Individual Defendant" executed on July 28, 1999, which contain material information relied upon by the Commission in negotiating and agreeing to the terms of this Order. In the event the Commission has reason to believe that a defendant knowingly failed to disclose any material asset, materially misrepresented the value of any asset, or made any other material misrepresentation or omission in the above-referenced financial statement, the Commission shall provide that defendant with a reasonable opportunity to explain the knowing misrepresentation or omission. As to any such knowing misrepresentation or omission not based upon a good faith estimate of property value, the Commission may move the Court to enter judgment against that defendant and in favor of the Commission in the amount of $500,000.00; provided, however, that in all other respects this Order shall remain in full force and effect unless otherwise ordered by the Court and that defendants have no right to contest any of the allegations in the Commission's complaint in this matter in any proceedings brought pursuant to this subparagraph; and provided further, that proceedings instituted under this provision would be in addition to and not in lieu of any other civil or criminal remedies as may be provided by law, including any other proceedings the Commission may initiate to enforce this Order. Provided, further, that nothing herein shall be deemed to preclude the defendant from contesting the allegations in the Commission's motion to reopen.

VIII. ACCESS TO BUSINESS PREMISES

IT IS FURTHER ORDERED that, for a period of ten (10) years from the date of entry of this Order, for the purpose of further determining compliance with this Order, defendants shall permit representatives of the Commission, within three (3) business days of receipt of written notice to defendants' counsel of record from the Commission:

A. Access during normal business hours to any office, or facility storing documents, of any business where (1) individually or jointly, defendants are officers, directors or majority owners or directly or indirectly control or manage the business, and (2) the business engages in the advertising, promotion, offering for sale, or sale of TMS. In providing such access, defendants shall permit representatives of the Commission to inspect and copy all documents relevant to any matter contained in this Order; and shall permit Commission representatives to remove documents relevant to any matter contained in this Order for a period not to exceed five (5) business days so that the documents may be inspected, inventoried, and copied; and,

B. To interview the officers, directors, and employees, including all personnel involved in responding to consumer complaints or inquiries, and all sales personnel, whether designated as employees, consultants, independent contractors or otherwise, of any business to which subsection A of this section applies, concerning matters relating to compliance with the terms of this Order. The person interviewed may have counsel present.

IX. AUTHORITY TO MONITOR COMPLIANCE

IT IS FURTHER ORDERED that the Commission is authorized to monitor defendants' compliance with this Order by all lawful means, including but not limited to the following means:

A. The Commission is authorized, without further leave of court, to obtain discovery from any person in the manner provided by Chapter V of the Federal Rules of Civil Procedure, Fed. R. Civ. P. 26 - 37, including the use of compulsory process pursuant to Fed. R. Civ. P. 45, for the purpose of monitoring and investigating defendants' compliance with any provision of this Order;

B. The Commission is authorized to use representatives posing as consumers and suppliers in contacts with defendants, their employees, or any other entity managed or controlled in whole or in part by defendants, without the necessity of identification or prior notice where the Commission has reason to believe defendants are engaged in the advertising, marketing, promotion, offering for sale, or sale of TMS or any goods or services for aspiring or professional models and actors, or the advertising, marketing, promotion, or offering of screen tests, casting calls or auditions when such screen tests, casting calls or auditions are being offered by defendants, their employees or persons directly or indirectly under their control, and when such activities are being offered in conjunction with the advertising, marketing, promotion, offering for sale of any product; and,

C. Nothing in this Order shall limit the Commission's lawful use of compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 U.S.C. §§ 49, 57b-1, to investigate whether defendants have violated any provision of this Order or Section 5 of the FTC Act, 15 U.S.C. § 45.

X. ACKNOWLEDGMENT OF RECEIPT OF ORDER BY DEFENDANT

IT IS FURTHER ORDERED that, within five (5) business days after receipt by defendants of this Order as entered by the Court, each defendant shall submit to the Commission a truthful sworn statement, in the form shown on Appendix B, that shall acknowledge receipt of this Final Order.

XI. DISTRIBUTION OF ORDER BY DEFENDANT

IT IS FURTHER ORDERED that, for a period of ten (10) years from the date of entry of this Order, defendants shall:

A. Provide a copy of this Order to, and obtain a signed and dated acknowledgment of receipt of same from, each officer or director, each individual serving in a management capacity, all personnel involved in responding to consumer complaints or inquiries, and all sales personnel, whether designated as employees, consultants, independent contractors or otherwise, immediately upon employing or retaining any such persons, for any business where (1) individually or jointly, defendants are officers, directors or majority owners or directly or indirectly control or manage the business, and (2) the business engages in the advertising, promotion, offering for sale, or sale of TMS; and,

B. Maintain for a period of three (3) years after creation, and upon reasonable notice, make available to representatives of the Commission, the original signed and dated acknowledgments of the receipt of copies of this Order, as required in the subsection A of this Section.

XII. MONITORING OF SALES PERSONNEL

IT IS FURTHER ORDERED that defendants, in connection with any business where (1) individually or jointly, defendants are officers, directors, managers or majority owners or directly or indirectly control or manage the business, and (2) the business engages in the advertising, promotion, offering for sale, or sale of TMS, are hereby restrained and enjoined from:

A. Failing to take reasonable steps sufficient to monitor and ensure that all employees and independent contractors engaged in sales or other customer service functions comply with Section I of this Order. Such steps shall include adequate monitoring of sales presentations or other calls with customers, and shall include, at a minimum, listening to oral representations made by persons engaged in sales or other customer service functions;

B. Failing promptly to investigate any consumer complaints received by any business to which this Section applies; and,

C. Failing to take corrective action with respect to any sales person whom defendants determine is not complying with this Order, which may include training, disciplining, and/or terminating such sales person and keeping records of each such action for a period of two (2) years.

XIII. RETENTION OF JURISDICTION

IT IS FURTHER ORDERED that this Court shall retain jurisdiction over this matter for purposes of the construction, modification and enforcement of this Order.

XIV. ENTRY OF THIS FINAL JUDGMENT

IT IS FURTHER ORDERED, pursuant to Federal Rule of Civil Procedure 54(b), that there is no just reason for delay and the Clerk of Court immediately shall enter this Order as a final judgment as to defendants.

SO STIPULATED:

IT IS SO ORDERED, this __________ day of__________, 1999.

________________________________
UNITED STATES DISTRICT JUDGE

APPENDIX A

NOTICE

[name of entity], a talent management services company, offers training workshops and other services for aspiring models and actors. Training is required for most potential models and actors who do not have professional experience. Training costs and associated fees range from [$__ to $__ ] per program.

• Our talent scouts may not have industry expertise to assess consumers' marketability as models or actors.

• [name of entity] does not guarantee future employment or earnings levels for its trainees. It is unlikely that you will receive substantial paid employment as a model or actor in the Washington, DC metropolitan market.

DATE:

Print Full Name

______________________________
Sign Full Name

APPENDIX B

UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF VIRGINIA

FEDERAL TRADE COMMISSION, Plaintiff

v.

MODEL 1, INC., et al., Defendants.

Civil No. 99-737 A

AFFIDAVIT OF

[Defendant's Name], being duly sworn, hereby states and affirms as follows:

1. My name is [name of defendant]. I am a citizen of the United States and am over the age of eighteen. I have personal knowledge of the facts set forth in this Affidavit.

2. I am a defendant in FTC v. Model 1, Inc. et al. (United States District Court for the Eastern District of Virginia).

3. My current business address is ________________________. My current business telephone number is ________________. My current residential address is ________________. My current residential telephone number is _____________.

4. On [date], I received a copy of the Final Consent Order, which was signed by the Honorable and entered by the Court on [date of entry of Order]. A true and correct copy of the Order that I received is appended to this Affidavit.

I declare under penalty of perjury under the laws of the United States that the foregoing is true and correct. Executed on [date], at [city and state].

______________________________
[name of defendant]

State of ____________________, City of ____________________

Subscribed and sworn to before me

this _____ day of _________, 199___.

_____________________________
Notary Public

My Commission Expires:

_____________________________

APPENDIX C

Dear Consumer:

Model 1, Inc. and the Federal Trade Commission recently settled a lawsuit in the U.S. District Court in Alexandria, VA. The lawsuit alleged that Model 1, Inc., while soliciting consumers to take modeling and acting courses, made misrepresentations that consumers are likely to earn substantial paid employment as a model or actor once consumers complete the training program at Model 1. Model 1 denies the allegations.

Our records reflect that you signed a contract for training and that you still owe on your account. Model 1 is winding up the training business and is trying to schedule classes for consumers interested in pursuing their training. We will be completing classes in January 2000. In order to be referred to our booking agents for representation, you must complete your training. If you are interested in pursuing your training, please call Model 1 as soon as possible at (703) 288-7719 to schedule your classes. If you have never previously attended training and are not interested in pursuing your training, you will be relieved of further obligation to pay on your contract.